KPMG’s Rethink Manufacturing report found that 56 per cent of manufacturers with operations in the North West plan to increase their R&D activities in the UK over the next three years.

Just under a third of respondants cited investment in new technology as one of the top three internal factors that would help boost their organisation’s productivity.

The survey also found that 90 per cent of those surveyed believe that innovation will remain the bedrock of UK manufacturing.

“Manufacturers clearly recognise the impact and importance of innovation for UK industry,” Craig Wright, Partner and Head of Manufacturing at KPMG in the North West.

“It is crucial that management teams take action and embrace the latest developments in technology, which will help further boost the North West’s manufacturing credentials around the world.”

North West manufacturers recognised the step change that new technologies will deliver to the heart of the sector.

More than half (59 per cent) said that Industry 4.0 – the creation of ‘smart factories’ using the latest digital technology – presents an unprecedented opportunity to revitalise UK manufacturing.

Many of the respondents (44 per cent) conceded that Industry 4.0 will have a major impact on their business model.

In response, NW firms are increasing their investment in technology. At present, nearly half (49 per cent) of respondents said that they are already investing in the Internet of Things.

Around a third (34 per cent) said that they were planning to boost their investment in this area before 2020.

Automation and advanced robotics are also high on the agenda. In the next three years, a significant proportion of manufacturers in the North-West plan to boost their investment in both fields – more than half (51 per cent) identified automation and 43 per cent noted advanced robotics as areas of priority.

Wright added: “The Government has already announced a host of initiatives that support innovation, such as its £2bn R&D fund for emerging technology, which includes artificial intelligence and robotics.

“That commitment can make a real difference to the fortunes of manufacturers, but it will depend upon the determination, vision and proactivity of business leaders to seize the opportunities before them.”

More than half of NW companies polled in KPMG survey said that digitisation in industry presents an unprecedented opportunity to revitalise UK manufacturing.